The View From 1776

The Road Ahead

The Federal Reserve’s unprecedented loose-money policy, based on Keynesian, socialistic economic theory, failed to jump-start the economy by inflating asset values in the stock and bond markets. 

Indeed, so far as I know,  Keynesian loose-money policy has never worked as expected anywhere, at any time.  Any activation of Keynes’s “animal spirits” translating into business revival has always petered out, or has led to destructive price inflation, rising public and private indebtedness, and gross misallocation of investment.

Because the Fed’s Keynesian policy has not worked, the Fed and Congress are now faced with very unpleasant alternatives.

How the Paper Money Experiment Will End

Posted by .(JavaScript must be enabled to view this email address) on 12/15 at 10:28 PM
  1. Or, on the other hand, one could argue that the Fed's (Keynesian) policy (in the negligent absence of stimulative spending by Congress) has been very effective in preventing a slide into depression. The Fed has very few tools to work with but has none-the-less helped to keep the economy working its way out of the 2008 recession, albeit much too slowly.

    According to the "sky is falling" school of thought, this Fed policy has doomed us to suffer galloping inflation "very soon." (But we have been hearing these predictions of the coming inflation monster from the Mises folks for years, so the predictive credibility of their economic model is not very high any more.)
    Posted by .(JavaScript must be enabled to view this email address)  on  12/16  at  10:56 AM
  2. "absence of stimulative spending by Congress"!?

    The congress-critters' aggressive over-spending policies of the last 80 years are "absent"?!

    How's the weather in your parallel universe? 54% of our USA is covered in snow, but if you're with Algore maybe you should stay in the shade to avoid further sun-stroke symptoms.


    (P.S. Does anyone in this universe have access to the 1970 and 1976 editions of _Historical Statistics of the United States_? I used to but have since lost a couple tables in moving from computer to computer and a couple disk crashes, though I have some of it on zip disks I can no longer read... and would like to fill in a few more details they had in those expenditures and debt tables, and spending by super-function and function and objectives.)
    Posted by .(JavaScript must be enabled to view this email address)  on  12/16  at  11:24 AM
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